Staff augmentation and software outsourcing are methods of bringing in additional people to help your company complete projects. However, the two approaches have key differences that could impact how well the work is executed. Keep reading to learn more about staff augmentation vs software outsourcing.

What Is Staff Augmentation?

Staff augmentation is a solution that businesses use to supplement their IT needs with an external agency. The company will work directly with the agency, hiring its contractors to handle specific tasks and projects.

How Staff Augmentation and Software Outsourcing Differ

Software outsourcing contracts with a company to provide software development services. Staff augmentation hires a team of employees who are already trained and working in-house for software development and can take on specific projects that require additional resources temporarily, as needed. The most significant difference between the two is their approach to managing the relationship between the client and vendor.

In software outsourcing, the clients usually manage all the software development. They define what needs to be developed or updated, they select which developers they want to work with and manage all aspects of the relationship.

With staff augmentation, the client oversees a team of internal employees whose jobs are primarily defined by other aspects of the work. Rather than hiring people explicitly to work on one project or another, these workers are employed by the company but have some time set aside for projects that require additional time and skills.

Importance of Staff Augmentation and Software Outsourcing

As part of the digital transformation, businesses are increasingly implementing a staff augmentation strategy to increase their capacity to deliver products and services.

Shifting to an outsourcing model lets businesses take advantage of the many benefits of software development in a global market.

Outsourcing can help businesses access the latest technological advances, ensuring highly skilled labor that would be expensive domestically.

As business processes become more sophisticated and digitized, companies’ ability to respond quickly becomes critical for remaining competitive.

Examples of Industries Using Staff Augmentation

Many industries use staff augmentation. These include:

  • Manufacturing
  • Information technology
  • Healthcare
  • Accounting and finance.

Benefits of Staff Augmentation

Staff augmentation hires professional services firms to assist with specific functions, needs, or projects. The benefits of staff augmentation include the following:

  • Increased strategic focus
  • More flexible and responsive
  • Improved efficiency.

What Is Software Outsourcing?

Outsourcing software development is a practice in which an organization seeks external company services to develop its software applications. The process involves the engagement of a third-party company to carry out the entire software development process on behalf of the company. It spans from requirements analysis and design to implementation, testing, and software maintenance.

Benefits of Software Outsourcing

The main advantage of outsourcing your software development project is that it lets you outsource the risk of your project to the hands of an experienced team while allowing you and your staff to focus on other essential aspects of your business. This also means you don’t have to invest in an expensive, time-consuming in-house software development team.

Examples of Industries Using Software Outsourcing

The most well-known industries that use software outsourcing are typically more high-tech, but that doesn’t mean the practice is limited to those fields. For example, retail stores — from the tiny convenience store to the big box chain use solutions developed and implemented by software companies based overseas.


When deciding whether to use software outsourcing or staff augmentation, there are things to consider. The apparent differences are that staff augmentation is a time- and labor-intensive option, while software outsourcing is an automated cost-cutting measure.

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